A time capsule of the greatest financial mania in the history of mankind, told in real-time by regular folks and patriots. May future generations better understand the madness of crowds, and how power and money corrupt.

September 26, 2006

MSM - enough is enough. Your use of David Lereah rip-and-read press release quotes with no disclaimer should be banned.

By giving this corrupt hack of the National Association of Realtors free-reign, you are allowing propaganda on the highest scale. He is the Tony Snow of real estate. The Iraqi Information Minister of the Housing Bubble.

Did any of you go to journalism school? Ever here of vetting your sources? Ever hear of challenging statements that are made with facts?David Lereah is a paid pawn of the NAR. He makes money on the side by selling books on how real estate values will only go up and up. Every word out of this man's mouth is a lie at best, corrupt at worst.

Every time you are tempted to use a David Lereah quote, think - who is the source? What does he have to gain here? Is what he is saying backed up by facts? What is his track history with predictions? Who pays him? How does he make his money? What motivations does he have to lie?

I recommend this disclaimer:

"David Lereah, discredited based on prior predictions that have not proven to be true, paid by the NAR to make claims about real estate that may or many not be based on facts, and the author of "Are You Missing the Real Estate Boom, ......"

In fact, the problem is even larger than just the David Lereahs; it's the ENTIRE economics profession.

Economics, as taught in mainstream colleges, is a pathetic mixture of Keynsian voodoo and pseudo-science.

Just pick up any macroeconomics textbook and see how they COMPLETELY ignore money as defined by the U.S. constitution, gloss over the immorality (and boom/bust dangers)of fiat currency, fractional reserve lending, and central banking.

Also ignored, is the danger of "securitization", which allows the "passing the hot potato of risk" to those who are less qualified to asses the downside potential (as much of ABS created by Wall Street eventually winds up in money market funds, mutual funds and pension funds).

Totally accepted is the "socializing of risk" by the creation of the GSEs (Fannie and Freddie) which allows the REIC to continue to create moral-hazard-backed debt, with all losses passed on to the taxpayer. The FDIC also serves in this same capacity to lull depositors to sleep.

Completely overlooked is the $400 TRILLION scam that is derivatives (source: www.bis.org) which are used to hide losses, create phony profits, evade taxes, obscure beneficial ownership, and other skullduggery.

Of course, the average person on the street is absolutely CLUELESS to how modern-day, international macroeconomics REALLY works. If the sheeps understood that the U.S. serves as the "mouth of the world" by burying itself in debt to its avowed ENEMIES (Communist China and Muslim OPEC), and that virtually at any moment the whole, contrived edifice could (and eventually will) copme crashing down, they might come to their senses and stop living beyond their means.

But I doubt it.

In any event, getting back to David Lereah and housing, David can be NO more effective at spreading the NAR propaganda than the sheeps are willing to allow through their ignorance of economics in general, their lack of emotional control (over the instincts of greed, the "I want it NOW! mindset) and their COMPLETE lack of understanding of finance.

And of course, the mainstream media is compromised by THEIR general ignorance of economics, their conflict of interest with their REIC advertisers and their own exposure to real estate.

So, as the collapse continues to play out, don't look for ANY mainstream media outlet or economist (with the exception of Robert Shiller) telling the sheeple the truth that in fact it is our entire economic system that is corrupt.

The problem is that news (CNN, Fox News, major newspapers, etc.) has become a series of polls and opinion pieces and not investigative journalism. Journalists want to find a person with the same point of view and interview them to make them look good, or find a person with an opposing point of view and interview them to make them look bad. It’s very rare that you see actual news in the MSM.

If a journalist, newspaper, editor, whatever wants their home prices to go up, they will interview someone like NAR who will give them that information. When journalists stop thinking they are making money on their homes, watch the tables turn. It’s the same thing with any other subject.

I have some faith in journalists. They did eventually figure out that they didn't need to quote "scientists" employed by the tobacco industry to tell the "other side" of the story on lung cancer.

Maybe eventually they'll figure out that an economist employed by the NAR is no more trustworthy.

I'm also not quite so hard on economists. Many of the more objective economists employed by universities have been warning about housing for quite some time. Journalists at the economist, financial times, and other quality publications have also shown integrity where it comes to reporting on housing.

I can't stand the way Lereah gets away with saying "this is the downturn we've been expecting".

What? Lereah has been warning about a downturn? Since when? Once the downturn was well underway, and nobody could possibly dispute that it was happening, then Lereah comes out and says it.

Of course, what he's really doing is trying to convince buyers that we've hit bottom and it's time to jump back into the market.

Dude, this downturn is only a few months old. This is the first YOY decline we've seen. To be calling the bottom right now... well, it's so obvious that Lereah has an ulterior motive my post is getting stupid. This housing thing is so over.